The large-cap indices opened flat on Thursday while the QQQ gapped down about 0.40%.  However, the bulls stepped in right away to rally all three major indices by 1.3% to 2% over the first hour, reaching the highs of the day at about 10:30 am.  From there we saw a sideways grind for an hour before the bears stepped in to lead a long, steady selloff, reaching the lows of the day at 2:30 pm.  The rest of the day saw a sideways rollercoaster ride not too far from the lows.  This action gave us a black-bodied Inverted Hammer-type candle in the SPY and DIA.  The QQQ formed a black-bodied Doji with a large upper wick.   The SPY and QQQ both retested and slightly broke below their T-line (8ema).

On the day, seven of the ten sectors were in the red.  Communications (+0.55%) was by far the biggest gaining sector while Utilities (-2.22%) and Industrials (-1.72%) led the way lower.  The SPY lost 0.83%, DIA lost 0.34%, and QQQ lost 0.51%.  The VXX fell 1.31% to 20.33 and T2122 fell but remains in the mid-range at 36.73.  10-year bond yields spiked again to 4.241% and Oil (WTI) was flat at $85.71/barrel.  So, all-in-all, it was another indecisive day punctuated by intraday reversals.

In economic news, Philly Fed Mfg. Index came in as -8.7, which was far worse than the -5.0 forecast, but also better than last month’s -9.9.  At the same time, Weekly Initial Jobless Claims came in much better than was expected at 214k (versus the 230k forecast and last week’s 226k).  Meanwhile, September Existing Home Sales fell 1.5% to a 10-year low of 4.71 million (which was essentially in line with the forecast of 4.70 million, but worse than the August number of 4.78 million) as mortgage rates continue to climb. In the afternoon, Philly Fed Pres. Harker said Thursday that rate hikes have done little to keep inflation in check.  He went on to say “we are going to keep raising rates for a while” and “I expect we will be well above 4% by the end of the year.”  This falls in line with the current rate being 3.25% and Fed Fund Futures now pricing in a 0.75% rate hike for November and December.

SNAP Case Study | Actual Trade

On the regulatory/legal front, the TX state AG has sued GOOGL for breaking the state’s law which prohibits companies from collecting user biometrics (facial recognition and voice data) without explicit user consent.  This is very similar to the state’s lawsuit against META for Facebook doing the same thing.  Meanwhile, AMZN is now facing a $1 billion lawsuit in the UK, claiming that the AMZN Marketplace abused its position and information to favor its own products over marketplace vendors.  Elsewhere, the US Dept. of Justice has requested more details about the proposed $8 billion deal for CVS to buy SGFY.  Finally, after the close, it was announced that WMT has agreed to pay the state of Florida $215 million to resolve claims related to its pharmacy’s part in opioid addiction in the state.

In other stock news, at the close, DB announced it has cut an unspecified number of staff from its investment banking unit as M&A activity (i.e., possible business) has dried up.  Elsewhere, the IPO for PRME (Prime Medicine) opened 12% higher than the IPO price of $17 first trading at $18.97.  Meanwhile, at the close, XOM announced it has agreed to sell its Montana refinery (which processes 63,000 barrels per day) to PARR for $310 million.  Well after the close, PFE said they expect to hike the cost of US covid-19 vaccines by 300% (from $30/dose to $120/dose) in the first quarter of 2023, when the original government purchase contracts expire and the cost is shifted from government to private insurers.  In addition, the Washington Post reported that Elon Musk told potential investors in his TWTR buyout that he plans to cut the TWTR staff by 75% (from 7,500 to under 2,000).  Finally, Bloomberg reported this morning that the Biden Administration is now discussing whether some of Musk’s ventures should be subjected to national security reviews (TWTR was not mentioned specifically, but the stock is suffering in pre-market on this news).

In international news, UK PM was forced to resign Thursday after only 6 weeks in office.  So, the UK is back in search of a leader.  However, the Tory party is fast-tracking the system this time and they may have named a new PM by Monday.  Whoever is selected will be pressured to renounce unfunded tax cuts (especially at the corporate and top-end brackets) as well as reaffirm the government commitments to cost of living increases in government programs. Meanwhile, the strong dollar continues to hurt most foreign economies as the Yen hit a 32-year low against the dollar (over 150 Yen per Dollar) and the Euro fell further below parity Thursday. Japan is back to saber rattling about intervention to strengthen the Yen, but there is little they can do when the US Fed is aggressively hiking rates and Japan’s economy is fragile enough that the Bank of Japan cannot match pace.

After the close, CSX, UFPI, SIVB, and SAM all reported beats on both revenue and earnings.  Meanwhile, SNAP and THC missed on revenue while beating on earnings.  On the other side, WAL beat on revenue while missing on earnings.  However, both RHI and WHR missed on both the top and bottom lines.  It should also be noted that WHR, RHI, and THC all lowered their forward guidance.

Overnight, Asian markets leaned heavily to the red side on mostly modest moves.  It was Singapore (-1.75%) that was an outlier while Taiwan (-0.98%), Australia (-0.80%), Hong Kong and Shenzhen (both -0.42%) paced the losses.  Malaysia (+0.61%) was by far the largest gainer.  Meanwhile, in Europe, exchanges are down across the board at midday Friday.  The FTSE (-0.72%), DAX (-1.34%), and CAC (-1.54%) are leading the region lower as markets react to the overnight collapse of the UK government (the 2^nd in two months) and a plummeting British Pound.  In the US, as of 7:30 am, US Futures are pointing toward a down start to the day.  The DIA implies a -0.33% open, the SPY is implying a -0.35% open, and the QQQ implies a -0.67% open at this hour.  10-year bond yields are soaring again to 4.265% and Oil (WTI) is up a half of one percent to $84.92/barrel in early trading.

The major economic news events scheduled for Friday are limited to a Fed speaker (Williams at 9:10 am).  The major earnings reports scheduled for the day include AXP, ALV, EEFT, HCA, HBAN, IPG, RF, SLB, and VZ before the open. There are no earnings reports scheduled for after the close. 

So far this morning, VZ, AXP, SLB, IPG, HBAN, and EEFT have all reported beats on both the revenue and earnings lines.  Meanwhile, HCA missed on revenue while beating on earnings. On the other side, RF beat on revenue while missing on earnings.  However, ALV reported a miss on both the top and bottom lines.

With that backdrop, the bearish trend remains in place (both the short-term one from this week and the longer-term one since August). Again, all 3 major indices continue to flirt with printing an inverted head and shoulders (bottoming) pattern. Market extension is not a factor, either in terms of the T-line or T2122. However, intraday reversals and indecision remain the norm as we have seen a lot of gaps and wicks this week. So, continue to be cautious and show patience (wait for confirmation). With high volatility and less certainty at the moment, this may be the time to pursue more cautious trading strategies (options spreads for example), including remaining hedged, quick, and/or small. Beyond this, do not forget that it’s Friday. So, pay yourself and consider taking some money off the table ahead of the weekend’s new cycle.

Don’t be stubborn. If you have a loss, just admit you were wrong and take it before it grows. And when price does move in your direction, always move your stops in your favor (remember the “Legend of the man in the green bathrobe“…it is NOT HOUSE MONEY, it’s all OUR MONEY!). Also, keep in mind that trading is not a hobby. It’s a job. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Lastly, remember that you get rich slowly and steadily in Trading…not by striking it rich on one or two trades. So, give up that lottery ticket mentality.

See you in the trading room.

Ed

Swing Trade Ideas for your consideration and watchlist: No trade ideas today (Rick is out). You can find Rick’s review of tickers on his YouTube Channel here. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service

On Wednesday, the major indices gapped down (SPY – 0.50%, DIA – 0.40%, and QQQ – 0.70%) at the open.  We then saw a rollercoaster ride that was highlighted by a sharp morning rally (taking us to the highs of the day at 10:30 am), a slow mid-day selloff (taking us to the lows of the day at 1 pm) and a sideways oscillation the rest of the day.  This action left us with gap-down, indecisive, Spinning Top candles (perhaps Doji in the QQQ) across the 3 major indices.  The SPY and QQQ both retested and held their T-lines (8ema) and all 3 traded lower than average volume.

On the day, nine of the ten sectors were in the red with only Energy (+2.13%) in the green.  Meanwhile, Healthcare (-2.23%) and Consumer Cyclicals (-1.98%) led the way lower.  SPY lost 0.71%, DIA lost 0.41%, and QQQ lost 0.36%.  The VXX rose 0.78% to 20.60 and T2122 fell back to the mid-range at 56.35.  10-year bond yields spiked to 4.131% and Oil (WTI) rose 3.36% to $85.63/barrel. Overall, it felt like an indecisive day where the market is waiting on something and can’t make up its mind.

In economic news, September Building Permits came in a bit above expectation (1.564 million versus 1.530 million forecast and 1.542 million in August).  However, Sept. Housing Starts came in below forecast (1.439 million actual versus 1.475 million forecast and 1.566 million in August).  The EIA Weekly Crude Oil Inventories came in well below expectations with a drawdown of 1.725 million barrels (compared to a build of 1.380 million barrels forecast and last week’s massive 9.880-million-barrel build). On the Fed front, Minneapolis Fed President Kashkari (strong hawk) told an audience that the US job market remained too strong and inflation probably has not peaked yet.  He went on to say that the FOMC may need to raise rates above 4.75% this year to fight inflation, but his best guess is that inflation should start to react sometime next year, allowing the Fed to pause its rate hikes.  Then last night, St. Louis Fed President Bullard told an audience that he expects the FOMC to end its “front-loading” of aggressive interest-rate hikes by sometime early next year.  He went on to say that beyond that, the central bank could use “small adjustments” to control the situation as inflation cools.

SNAP Case Study | Actual Trade

In stock news, Bloomberg reports that T is working with MS to fund a joint venture with some unspecified infrastructure partner with the aim of investing billions of dollars in the US fiber-optic network expansion.  Meanwhile, FFIE announced that the company has cut jobs and reduced salaries (in exchange for employees getting equity positions) in order to conserve cash.  However, the company is still in talks to raise cash because the conservation will not sustain its burn rate.  Meanwhile, GOOGL-owned Waymo announced it will launch its self-driving ride-hailing service into Los Angeles soon, but on an unspecified date.  (The service is now available and has operated in Phoenix since 2018.)  GTBIF is teaming up with Canadian convenience store chain “Circle K” to sell marijuana at gas stations (with a separate entrance) in 10 Florida locations starting next year.

In energy news, the US Senate quietly advanced the NOPEC bill aimed at punishing OPEC+ countries for their recent production cuts.  The bill would remove the sovereign immunity that national oil companies now have, allowing them to be sued for collusion on price-fixing.  (It’s unclear how the US could enforce rulings, even if companies like Saudi Aramco were found guilty by a US court.)  Earlier, President Biden announced the release of an additional 15 million barrels of oil from the Strategic Petroleum Reserve as well as a plan to begin replenishing the reserve once oil prices hit $70.  It is also worth noting that the US Dollar gained again Wednesday against all its peer currencies (in lock-step with the spike in bond rates).  This made oil cheaper, yet even so, the fear over supply and reduction in US oil inventories drove oil prices higher.

After the close, IBM, EFX, STLD, KALU, LRCX, LBRT, and CCI reported beats on both the revenue and bottom lines.  Meanwhile, TSLA missed on revenue while beating on earnings.  On the other side, KMI, UMPQ, and PACW beat on revenue while missing on earnings.  At the same time, LSTR beat on revenue and came in inline on earnings. However, PPG, AA, KNX, and LVS all missed on both the top and bottom lines.

So far this morning, T, PM, DOW, AAL, DHR, ERIC, GPC, DGX, ALK, POOL, SNA, MSM, and SNV all reported beats on both the revenue and earnings lines.  At the same time, ABB, FITB, KEY, and HRI all beat on revenue while missing on earnings.  On the other side, NOK, BX, MMC, TSCO, and DOV all missed on revenue while beating on earnings.  At this point, there have been no companies that reported misses on both lines today.  (NUE, FCX, UNP, MAN, and WSO report closer to the opening bell.)

Overnight, Asian markets were mixed but leaned heavily to the downside.  Hong Kong (-1.40%), Australia (-1.02%), and Japan (-0.92%) led the move lower.  Only Malaysia (+1.60%), India (+0.30%), and Thailand (+0.25%) managed to stay green in the region.  In Europe, we have a more mixed picture at midday.  The FTSE (+0.01%), DAX (-0.37%), and CAC (+0.44%) are typical of the widely split continent in early afternoon trade.  As of 7:30 am, US Futures are pointing toward a modest gap higher to start the day (ahead of data).  The DIA implies a +0.51% open, the SPY is implying a +0.36% open, and the QQQ implies a +0.15% open at this hour.  10-year bond yields are down slightly to 4.128% and Oil (WTI) is up 1.67% to $86.98/barrel in early trading.

The major economic news events scheduled for Thursday include Weekly Jobless Claims and Philly Fed Mfg. Index (both at 8:30 am), Sept. Existing Home Sales (10 am) and a pair of Fed Speakers (Harker at noon and Bowman at 2:05 pm).  The major earnings reports scheduled for the day include ABB, ALK, AAL, T, BX, DHR, DOV, DOW, EWBC, ERIC, FITB, FCX, GPC, HRI, KEY, MAN, MMC, MSM, NOK, NUE, PM, POOL, DGX, SNA, SNV, TSCO, UNP, WSO, and WBS before the open. Then, after the close, SAM, CSX, RHI, SNAP, SIVB, UFPI, WAL, and WHR report. 

In economic news later this week, on Friday, Fed member William speaks.  In earnings reports later this week, on Friday, we hear from AXP, ALV, EEFT, HCA, HBAN, IPG, RF, SLB, and VZ.

In late-breaking international news, the UK government is in turmoil after PM Truss fired another key cabinet member (and again replaced them with someone who did not support her) and the Tory party whip had to use literal force to make Tory members vote the way the PM wanted them to vote. So, the UK media is now openly handicapping who will replace Truss. Meanwhile, in China, the government is weighing whether or not to cut the quarantine time for foreign visitors. At the same time, the top Chinese technology official has summoned Chinese semiconductor companies to an emergency meeting on how to counter President Biden’s chip sale restrictions. Finally, in Ukraine, the Russian use of Iranian “kamikaze drones” to attack both cities and general and electrical infrastructure, in particular, has caused enough damage that President Zelenzkyy has imposed nationwide electric use restrictions.

With that backdrop, the bearish trend continues while all 3 major indices flirt with printing an inverted head and shoulders (bottoming) pattern. Market extension is not a factor, either in terms of the T-line or T2122. Still, the intraday reversals and daily chop remain serious concerns. So, continue to be cautious and show patience (wait for confirmation). With high volatility and less certainty, this may be the time to pursue more cautious trading strategies, including remaining hedged, quick, and/or small.

Don’t be stubborn. If you have a loss, just admit you were wrong and take it before it grows. And when price does move in your direction, always move your stops in your favor (remember the “Legend of the man in the green bathrobe“…it is NOT HOUSE MONEY, it’s all OUR MONEY!). Also, keep in mind that trading is not a hobby. It’s a job. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Lastly, remember that you get rich slowly and steadily in Trading…not by striking it rich on one or two trades. So, give up that lottery ticket mentality.

See you in the trading room.

Ed

Swing Trade Ideas for your consideration and watchlist: No trade ideas today (Rick is out). You can find Rick’s review of tickers on his YouTube Channel here. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service

Markets gapped significantly higher at the open (+2.25% in SPY, +2.05% in DIA, and +2.70% in the QQQ) on Tuesday.  However, this was a bull trap.  All 3 major indices immediately sold off hard.  The QQQ had more than faded the gap, while the SPY got within a quarter of one percent and the DIA got within one-third of one percent of doing so by 11:40 am.  From there, we saw a modest rally that lasted until 2:30 pm, regaining about half of the original gap during that time.  Then the bears stepped in to sell off all 3 major indices again at 2:30 pm, revisiting the lows of the day within 15 minutes.  After a pause at the lows, the bulls stepped in for a rally to end the day.  This action gave us large, black candles with a large lower wick in all major indices.

On the day, all 10 sectors were in the green with Communication (+0.50%) lagging and Industrials (+2.03%) leading the charge.  The SPY and DIA both gained 1.13% and the QQQ gained 0.79% on the session.  The VXX fell almost 2% to 20.44 while the T2122 (4-week New High/Low Ratio) jumped back up into the overbought territory at 87.68.  10-year bond yields fell back to 3.998% and Oil (WTI) was down 2.6% to $83.23/barrel.  So, overall, it was a bull trap day with a “gap and crap” action perhaps with some short profit-taking at the end of the day.

In economic news, September Monthly Industrial Production came in much hotter than forecast at +0.4% (versus +0.1% expected and -0.1% in August).  After the close, API reported Weekly Crude Oil Stocks fell 1.270 million barrels (versus an expected build of 1.551 million barrels and compared to last week’s 7.054-million-barrel build).  Atlanta Fed Pres. Bostic spoke before the Urban Institute Tuesday, speaking to Main Street rather than Wall Street and explaining current problems and the potential upside of recession.  He said the economy is still trying to deal with the turmoil caused by the wage and job trends that stemmed from the Pandemic.  The basic problem is that large numbers of workers quit, retired, moved, or changed fields during the pandemic, which put real labor pressure on all companies.  However, the large (deep-pocketed) companies were in the position to raise wages and move to a remote work model.  In that way, they drew workers away from lower wages and less flexible jobs when the economy picked back up. The issue was aggravated this year by inflation, where again the large profitable companies were in a better place to raise wages.  All of this has put small and medium-sized firms in serious trouble, unable to find workers at the lower wages they had been paying (and could afford) in the past.  He did not say so, but he did imply that a recession cycle will help lessen the problem for the SMEs that survive.

SNAP Case Study | Actual Trade

In stock news, Bloomberg reported that CS will be working with MS and RBCI to increase capital.  The details were not available, but previous reporting said CS needs at least $2 billion to shore up its balance sheet and to do restructuring.  Meanwhile, the FAA told BA that some of the company’s documentation submissions for the “737 Max 7” are incomplete and others need reassessment by BA. It was reported Tuesday that AAPL has told its main phone manufacturer in China to halt production and the two main component makers to drastically reduce the production of the iPhone 14 Plus (the cheaper, $899 model) as AAPL reevaluates product demand.  Elsewhere, TWTR froze its employee stock award accounts ahead of an anticipated closing of the Musk buyout will happen at $54.20 on or before Oct. 28.  Finally, AMZN workers in NY have rejected unionization by a 2-to-1 margin.

In stock IPO and M&A news, for the second day in a row, INTC lowered its outlook for the IPO of its self-driving car division Mobileye.  The April expectation was for $50 billion, on Monday it was $20 billion, and on Tuesday at the IPO roadshow, the company said it was now targeting a $16 billion valuation.  Meanwhile, an activist fund (Third Point) announced it has taken a significant position in CL and has urged the company to spin off its Hills Pet Nutrition division via IPO.  Third Point said in an open investor letter that it expects Hills to be worth $20 billion as a standalone company.  Finally, the US Senate Judiciary Committee expressed concerns over the KR acquisition of ACI and said it will hold hearings on the deal next month.

After the close, UAL, NFLX, OMC, JBHT, ISRG, IBKR, and WTFC all reported beats on both the revenue and earnings lines.  It is worth noting that NFLX crushed expectations and also reversed its subscriber losses, adding 2.41 million new subscribers during the quarter.  However, the company did also lower its forward guidance.  Meanwhile, UAL significantly raised its forward guidance on air travel trends.  In less good news, FHN beat on the top line while missing on earnings.

So far this morning, ABT, ASML, PG, TRV, CFG, NDAQ, WGO, CMA, SC, and ELV have all reported beats on both the revenue and earnings lines.  Meanwhile, BKR missed on revenue while beating on the earnings line.  On the opposite side, MTB beat on the revenue side while coming in below analyst estimates on earnings.  However, ALLY reported misses on both the top and bottom lines

Overnight, Asian markets were mixed but leaned to the downside.  Hong Kong (-2.38%), Shenzhen (-1.43%), and Shanghai (-1.19%) paced the losses.  Meanwhile, Malaysia (+1.05%), New Zealand (+0.64%), and Japan (+0.37%) led the gainers.  In Europe, we see a similar picture taking shape at midday.  Russia (-3.12%) is an outlier.   However, the FTSE (-0.02%), DAX (+0.07%), and CAC (+0.17%) represent the middle ground with most smaller exchanges in the red, but also half a dozen of them modestly green in early afternoon trade.  As of 7:30 am, US Futures are pointing toward a down start to the day.  The DIA implies a -0.25% open, the SPY is implying a -0.30% open, and the QQQ implies a -0.26% open at this hour.  10-year bond yields are back up to 4.088% and Oil (WTI) is up 1.25% to $83.84/barrel in early trading.

The major economic news events scheduled for Wednesday include Sept. Building Permits and Sept. Housing Starts (both at 8:30 am), EIA Weekly Crude Oil Inventories (10:30 am), and Fed Beige Book (2 pm).  We also have 2 Fed speakers scheduled, Kashkari at 1 pm and Bullard at 7:30 pm.  The major earnings reports scheduled for the day include ABT, ALLY, ASML, BKR, CFG, CMA, ELV, LAD, MTB, NDAQ, NTRS, PG, PLD, SCL, TRV, UNF, and WGO before the open. Then, after the close, AA, CCI, EFX, IBM, KALU, KMI, KNX, LRCX, LSTR, LVS, LBRT, PPG, STLD, TSLA, and UMPQ report.

In economic news later this week, on Thursday, Weekly Jobless Claims, Philly Fed Mfg. Index, and Sept. Existing Home Sales are reported.  Finally, on Friday, Fed member William speaks.

In earnings reports later this week, on Thursday, ABB, ALK, T, BX, DHR, DOV, DOW, EWBC, ERIC, FITB, FCX, GPC, HRI, KEY, MAN, MMC, MSM, NOK, NUE, PM, POOL, DGX, SNA, SNV, TSCO, UNP, WSO, WBS, SAM, CSX, RHI, SNAP, SIVB, UFPI, WAL, and WHR report.  On Friday, we hear from AXP, ALV, EEFT, HCA, HBAN, IPG, RF, SLB, and VZ.

Last night’s big beat by NFLX had futures flying as traders read that turn-around as a sign for tech stocks in general. However, overnight trading soon came back to earth as the market continues to reset expectations for a recession. Another sign of that “recession fear” is that mortgage demand fell to a 25-year low last week as the average mortgage rate for a 30-year, fixed-rate loan rose to 6.94% (from 6.81%). So, it seems good earnings (in general) have only limited strength against a tide of economic pessimism.

With that backdrop, extension is not a factor, either in terms of the T-line or T2122. However, intraday reversals and daily chop are serious concerns. Remember that the downtrend remains intact in all the major indices. So, be cautious and demonstrate patience (wait for confirmation). With high volatility and less certainty, this may be the time to pursue more cautious trading strategies, including remaining hedged, quick, and/or small.

Don’t be stubborn. If you have a loss, just admit you were wrong and take it before it grows. And when price does move in your direction, always move your stops in your favor (remember the “Legend of the man in the green bathrobe“…it is NOT HOUSE MONEY, it’s all OUR MONEY!). Also, keep in mind that trading is not a hobby. It’s a job. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Lastly, remember that you get rich slowly and steadily in Trading…not by striking it rich on one or two trades. So, give up that lottery ticket mentality.

See you in the trading room.

Ed

Swing Trade Ideas for your consideration and watchlist: No trade ideas today (Rick is out). You can find Rick’s review of tickers on his YouTube Channel here. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service

Markets gapped up strongly (+1.75% in the SPY, +1.40% in DIA, and up 2.40% in the QQQ) Monday.  We then proceeded to get bullish follow-through the first 45 minutes of the day. However, at that point, it was like we hit a brick wall covered in Velcro and just got stuck right there as price traded sideways in a very tight range the entire rest of the day.  This action gave us white, Harami candles in all 3 major indices, with DIA being a white, Spinning Top Harami.  All 3 now sit on top of their T-line (8ema), but none of them has broken through local resistance or downtrend.

On the day, all 10 sectors are well into the green with Consumer Defensive (+1.37%) lagging and Technology (+3.52%) and Consumer Cyclical (+3.45%) leading the charge higher.  The SPY gained 2.52%, DIA gained 1.77%, and QQQ gained 3.30%. The VXX was down 2.84% to 20.84 and T2122 has spiked up, but remains just outside the overbought territory at 75.56.  10-yr. bond yield also showed great volatility, recovering from an early plunge to recover up to 4.017%.  And Oil (WTI) is just on the red side of flat at $85.50/barrel. So, overall, a gap-up then a dead flat day.

In economic news, the NY Fed Empire State Mfg. Index came in worse than expected at -9.10, compared to a forecast of -4.00 and September’s reading of -1.50. Meanwhile, Bloomberg Economics updated its model on Monday.  The new forecast projects a 100% probability of a recession within the next 12 months.  The previous update of the forecast had placed the probability at 65%.

SNAP Case Study | Actual Trade

In stock news, STLA said Monday it is seriously considering stopping all car production in China as the major carmakers (western) continue to lose Chinese market share to domestic car companies. Elsewhere, Bloomberg reports that CS has begun the sale of its US Asset Management unit.  Sources told Bloomberg that several private equity firms are interested in the unit, which includes a platform for investing in collateralized loan obligations.  Meanwhile, GOOGL’s YouTube platform announced new advertising methods to reach music and podcast listeners on Monday.  Finally, the Wall Street Journal has reported that INTC has dramatically lowered the valuation of their Mobileye (self-driving car) unit, which the tech giant is in the process of spinning off and IPO.  INTC originally expected an IPO price that would give a $50 billion valuation, but now the company is expecting only $20 billion (or less) from the spinoff.  The IPO roadshow for that spinoff is set to kick off today and will eventually trade under the ticker MBLY.

In stock legal news, the US Dept. of Justice has moved to dismiss its antitrust indictment against two former PPC executives after other prosecutions on the price-fixing charges failed to secure a conviction.  On the other side, the Wall Street Journal reports that the FTC has launched an investigation of V and MA over whether they are using their security token standards to limit debit-card routing competition for online payments.  The agency has already been investigating whether the two firms are stopping merchants from routing payments over other debit card networks. Meanwhile, the US DOJ has filed suit against CI, charging that the company over-charged the Medicare Advantage program by submitting false diagnoses (without the tests that would prove the ailments) in order to increase charges between 2012 and 2019.  Finally, CS paid $495 million to settle a case related to mortgage-backed securities that had been brought by the state of New Jersey.  The NJ Attorney General had claimed $3 billion in damages when the case originated in 2013 and the underlying crime had taken place in 2008.

In energy news, the US EIA said on Monday that oil output from the Texas and New Mexico Permian (shale oil) Basin is forecasted to reach a record in November.  The region’s output is forecast to rise by 50,000 barrels per day to 5.453 million barrels per day.  This is part of a nationwide increase of 104,000 bpd forecast to come from all US shale basins in the month.  Elsewhere, XOM said Monday it has now exited Russia completely after Putin expropriated the company’s Russian properties.  XOM values its losses from that expropriation at $4 billion. Finally, Bloomberg reports that the Biden Administration is moving toward releasing another 10-15 million barrels of oil from the strategic petroleum reserve in a bid to keep gas prices under control.

So far this morning, JNJ, GS, and SBNY all reported beats on the top and bottom lines.  Meanwhile, TFC, MLI, and CBSH all reported beating on the revenue line while also missing on the earnings line.  On the other side, LMT missed slightly on revenue while beating on earnings.  However, HAS missed on both the earnings and revenue lines. STT reports later, at 8:50 am.

Overnight, Asian markets were green with only Shanghai (-0.13%) below break-even.  At the same time, Hong Kong (+1.82%), Australia (+1.72%), and Japan (+1.42%) led the region higher with most exchanges gaining over one percent.  In Europe, we see a similar story taking shape at midday.  Portugal (-0.53%) is the only red in the region while the FTSE (+1.00%), DAX (+1.30%), and CAC (+0.83%) lead the continent higher.  As of 7:30 am, US Futures are pointing toward another gap higher to start the day.  The DIA implies a +1.36% open, the SPY is implying a +1.59% open, and the QQQ implies a +1.84% open at this hour.  10-year bond yields are back down to 3.998% and Oil (WTI) is off a quarter of a percent to $85.22/barrel in early trading.

The major economic news events scheduled for Tuesday are limited to Sept. Industrial Production (9:15 am) and API Weekly Crude Oil Stocks Report (4:30 pm).  The major earnings reports scheduled for the day include ACI, GS, HAS, JNJ, LMT, SBNY, STT, and TFC before the open. Then, after the close, AMX, FHN, IBKR, ISRG, JBHT, NFLX, OMC, UAL, and WTFC report.

In economic news later this week, on Wednesday, we see Sept. Building Permits, Sept. Housing Starts, EIA Weekly Crude Oil Inventories, Fed Beige Book, Fed member Bullard speak. On Thursday, Weekly Jobless Claims, Philly Fed Mfg. Index, and Sept. Existing Home Sales are reported.  Finally, on Friday, Fed member William speaks.

In earnings reports later this week, on Wednesday, we hear from ABT, ALLY, ASML, BKR, CFG, CMA, ELV, LAD, MTB, NDAQ, NTRS, PG, PLD, SCL, TRV, UNF, WGO, AA, CCI, EFX, IBM, KALU, KMI, KNX, LRCX, LSTR, LVS, LBRT, PPG, STLD, TSLA, and UMPQ.  On Thursday, ABB, ALK, T, BX, DHR, DOV, DOW, EWBC, ERIC, FITB, FCX, GPC, HRI, KEY, MAN, MMC, MSM, NOK, NUE, PM, POOL, DGX, SNA, SNV, TSCO, UNP, WSO, WBS, SAM, CSX, RHI, SNAP, SIVB, UFPI, WAL, and WHR report.  On Friday, we hear from AXP, ALV, EEFT, HCA, HBAN, IPG, RF, SLB, and VZ.

Overnight gaps seem to be all the rage lately, perhaps revealing a clue to big fund action (manipulation?) in the shadows. And although Monday was a dead tape after 10 am, volatility is still a major concern given the intraday action we saw last week. The premarket seems to indicate we want to test a recent resistance level and has us there now. Don’t get caught up in emotions, especially FOMO. Remember the bull trap on Friday and the bear trap on Thursday that ripped the face off those who chased the gap on those days. Once again, the prudent trader will let things settle out for a while before adding any new positions.

Market extension still is not a factor, either in terms of the T-line or T2122. However, chop and intraday reversal are serious concerns. This will be a big earnings week (see above) and Fed speakers are also likely to cause gyrations as traders keep trying to outguess the FOMC. Remember that the downtrend remains intact in all the major indices. So, be cautious and demonstrate patience (wait for confirmation).

Don’t be stubborn. If you have a loss, just admit you were wrong and take it before it grows. And when price does move in your direction, always move your stops in your favor (remember the “Legend of the man in the green bathrobe“…it is NOT HOUSE MONEY, it’s all OUR MONEY!). Also, keep in mind that trading is not a hobby. It’s a job. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Lastly, remember that you get rich slowly and steadily in Trading…not by striking it rich on one or two trades. So, give up that lottery ticket mentality.

See you in the trading room.

Ed

Swing Trade Ideas for your consideration and watchlist: No trade ideas today (Rick is out). You can find Rick’s review of tickers on his YouTube Channel here. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service

US markets gapped higher at the Friday (+0.70% in the SPY, +0.65% in the DIA, and +0.95% in the QQQ) on solid big bank earnings reports.  However, within 10 minutes, the reversal kicked in to see all 3 major indices sell off hard the first hour.  Then a long, slow, grinding bear trend took over to drive us to the lows of the day within a couple of minutes of the close.  This action gave us a Bear Dark Cloud Cover signal in the SPY and QQQ, with a similar candle in the DIA (just support from the T-line prevented it from reaching the right size to be a true Dark Cloud Cover).  The SPY and QQQ also both failed to find support at their T-lines (8ema).

On the day, all 10 sectors were in the red, with Basic Material (-3.75%) leading the market lower while Healthcare (-1.33%) and Communication Services (-1.36%) held up the best.  Meanwhile, SPY was down 2.28%, DIA was down 1.24%, and QQQ was down 3.01%.  The VXX was up 2.24% to 21.45 and T2122 fell but remains in the mid-range at 34.78.  10-year bond yields have reversed an early loss to jump to 4.022% while Oil (WTI) is down 3.92% to $85.61/barrel.  Overall, Friday was a big “bull trap” bearish reversal day which also partially reversed Thursday’s wild bullish ride.

In economic news Friday, September Retail Sales came in dead flat (compared to a forecast of +0.2% and an August reading of +0.4%).  The September Export Price Index was -0.8% (which was better than the -1.0% forecast and the August -1.7%) while the Sept. Import Price Index was -1.2% (which was lower than the forecast -1.1% as well as the August -1.1%). August Business Inventories grew less than expected at +0.8% (versus the +0.9% forecast and July’s +0.5%). The Michigan Consumer Sentiment reading was better than expected a 59.8 (versus the 59.0 forecast and last month’s 58.6 number).  On the Fed front, in a speech at Harvard, Fed Governor Waller said that a digital dollar would not offer material benefits over current US-dollar-denominated payments.  He said this is especially true since a central bank digital currency would introduce additional threats, such as cybersecurity threats.  Finally, Atlanta Fed President Bostic announced late Friday that he had “accidentally” broken Fed trading rules over recent years by doing personal trading during the Fed blackout (pre-announcement) periods, had filed “incomplete” disclosure documents, and had owned more than the permissible limit of US Treasury Bonds last year.  He went on to say that despite these revelations, he had never traded on non-public information.  However, the Fed has begun an investigation and the same type of activity has led to two Fed resignations in the last year.

SNAP Case Study | Actual Trade

In stock news, ABT recalled some of its liquid Similac brand baby formula (due to a bottle defect) on Friday.  Meanwhile, Reuters reported that CS is in talks with several of its peer big banks about underwriting a potential stock offering to raise capital.  The bank said it would prefer not to sell more shares at the current depressed price, but is making plans in case it becomes unavoidable.  The Wall Street Journal reported that Rupert Murdoch is considering combining FOX (and FOXA) with NWSA.  Elsewhere, SLB is getting backlash from 9,000 Russian employees after the company began cooperating with Russian authorities to carry out military conscription orders at work. On Saturday, a second AAPL store (in OK this time) voted to unionize.

In international news, on Friday, UK Prime Minister Truss fired her finance minister (Chancellor of the Exchequer). She also reversed course on the corporate tax cuts she had promised and dug her heels in to defend as late as Thursday.  However, calls for her to resign (just 38 days into the job) continued this weekend.  Meanwhile, markets in the UK are in crisis due to contradictory, unworkable, and unpopular messaging and policies coming out of the PM and her cabinet. Meanwhile, in China, Xi Jinping opened the Communist Party Congress and is expected to be reelected to an unprecedented third term as the head of the Chinese Communist Party later this week.  In his opening speech, Xi doubled down on his “Zero Covid” policy (which still has several major cities locked down and has quarantines in place for some intracity travel) as well as calling for more competition with the US, including the semiconductor arena.

In dividend news, on Sunday, Investing.com reported last week’s largest dividend hikes.  CMC raised its quarterly dividend by 14.3% to $0.16/share (which amounts to an annual yield of 1.6%). LOCO declared a special dividend of $1.50/share (for holders of record on 10/24) to be payable on Nov. 9.  MCD increased its dividend by over 10% to reach a 2.5% annual yield of $6.08/share.  Meanwhile, SKT increased its annual dividend by 10% to $0.22/share, which is a 1.5% annual yield.

So far this morning, BAC and BK both reported beats on the revenue and earnings lines.  In particular, BAC beat revenue estimates by nearly $7 billion.  (SCHW reports at 8:45 am).  In other bank news, the Wall Street Journal reports that GS implemented a sweeping reorganization, splitting its largest unit into three divisions while also combining its asset management and wealth management businesses into a single unit.  

Overnight, Asian markets were mixed with Australia (-1.40%), Taiwan (-1.23%), and Japan (-1.16%) leading the losses.  Meanwhile, India (+0.73%), Thailand (+0.68%), and Shanghai (+0.42%) paced the gains.  However, in Europe, the exchanges are green across the board.  The FTSE (+0.72%), DAX (+0.91%), and CAC (+0.93%) are leading the region higher partially on the good news that Germany has no filled 95% of their natural gas storage (ahead of winter) and partially on a nearly total reversal by the UK government on it unfunded tax cuts and freeze of cost-of-living adjustments.  As of 7:30 am, US Futures are pointing to a significant gap up to start the week.  The DIA implies a +1.03% open, the SPY is implying a +1.24% open, and the QQQ implies a +1.49% open at this hour.  10-year bond yields continue being volatile as they have plunged back down to 3.947% and Oil (WTI) is flat at 85.61/barrel in early trading.

The major economic news events scheduled for Monday are limited to NY Empire State Mfg. Index (8:30 am) and Federal Budget Balance (2pm tentative).  The major earnings reports scheduled for the day include BAC, SCHW, and BK before the open.  There are no major reports scheduled for after the close.

In economic news later this week, on Tuesday we get Sept. Industrial Production and API Weekly Crude Oil Stocks Report.  Then Wednesday, we see Sept. Building Permits, Sept. Housing Starts, EIA Weekly Crude Oil Inventories, Fed Beige Book, Fed member Bullard speak. On Thursday, Weekly Jobless Claims, Philly Fed Mfg. Index, and Sept. Existing Home Sales are reported.  Finally, on Friday, Fed member William speaks.

In earnings reports later this week, on Tuesday, ACI, GS, HAS, JNJ, LMT, SBNY, STT, and TFC report.  Then Wednesday, we hear from ABT, ALLY, ASML, BKR, CFG, CMA, ELV, LAD, MTB, NDAQ, NTRS, PG, PLD, SCL, TRV, UNF, WGO, AA, CCI, EFX, IBM, KALU, KMI, KNX, LRCX, LSTR, LVS, LBRT, PPG, STLD, TSLA, and UMPQ.  On Thursday, ABB, ALK, T, BX, DHR, DOV, DOW, EWBC, ERIC, FITB, FCX, GPC, HRI, KEY, MAN, MMC, MSM, NOK, NUE, PM, POOL, DGX, SNA, SNV, TSCO, UNP, WSO, WBS, SAM, CSX, RHI, SNAP, SIVB, UFPI, WAL, and WHR report.  On Friday, we hear from AXP, ALV, EEFT, HCA, HBAN, IPG, RF, SLB, and VZ.

Volatility seems to want to continue to be the rule, as premarket futures indicate we will be popping back inside Friday’s big, ugly black candle. However, do not get caught up in emotions. Remember the bull trap on Friday and the bear trap on Thursday that ripped the face off those who chased the gap those days. So, just let things settle out for a while before you go adding any new positions.

Extension isn’t a factor today, either in terms of the T-line or T2122. However, volatility and intraday reversal are valid and serious concerns. This will be a big earnings week (see above) and Fed speakers are also likely to cause gyrations as traders keep trying to outguess the FOMC. Remember that the downtrend remains intact in all the major indices and, for what it is worth, we also had a bearish candle signal on Friday. So, be cautious and demonstrate patience (wait for confirmation).

Don’t be stubborn. If you have a loss, just admit you were wrong and take it before it grows. And when price does move in your direction, always move your stops in your favor (remember the “Legend of the man in the green bathrobe“…it is NOT HOUSE MONEY, it’s all OUR MONEY!). Also, keep in mind that trading is not a hobby. It’s a job. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Lastly, remember that you get rich slowly and steadily in Trading…not by striking it rich on one or two trades. So, give up that lottery ticket mentality.

See you in the trading room.

Ed

Swing Trade Ideas for your consideration and watchlist: DHC, WFC, JPM, BA, LUV, SB, NWL, EA, IGT. You can find Rick’s review of tickers on his YouTube Channel here. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service

Huge volatility was the rule Thursday. Stocks gapped sharply lower at the open (-2% in the SPY, -1.8% in the DIA, and -2.9% in the QQQ) after a hot September CPI number. However, as I had warned in the morning blog, whiplash immediately kicked in as the bulls led a huge rally until 11:45 am. Over those 2.25 hours, the SPY gained a massive 5%, DIA gained a staggering 4.5%, and QQQ gained an incredible 6%.  However, that was not the end of the huge volatility.  The rest of the afternoon, we saw a couple more big moves to the downside (and the resulting even larger whips back to the upside). Still, it is important to note that the volume on those later swings began to fade as the day ground on.  In the end, we closed not too far from the highs of the day. 

This action gave us huge, heavy volume, Bullish Engulfing candles (with small wicks on both ends) in all 3 major indices.  The SPY and DIA managed to cross and close above their T-lines (8ema), but the QQQ failed that test (at least for the day).  All 10 sectors are green with Energy (+3.67%) leading the charge and the Consumer Cyclical sector (+1.22%) lagging.  The SPY gained 2.61%, DIA gained 2,84%, and QQQ up 2.32%.  Meanwhile, the VXX fell 2.6% to 20.98 and T2122 has jumped from oversold up into the mid-range at 65.15.  10-year bond yields have spiked to 3.96% and Oil (WTI) was up 2.13% to $89.13/barrel.

In economic news, as mentioned above, the September Month-on-month CPI reading came in at +0.4% (versus +0.2% forecast and +0.1% in August).  That took the September Annualized CPI to +8.2% (versus +8.1% that had been forecast and +8.3% as of August).  So, inflation fell slightly on an annual basis, but not as much as expected.  The Weekly Initial Jobless Claims also came in slightly above expectations at 228k (versus 225k forecast and 219k last week).  Finally, in the late morning, the EIA Crude Oil Inventory showed a massive 9.880 million barrel increase in stocks (versus a forecast 1.750 million barrel build forecast and a drawdown of 1.356million barrels last week).

SNAP Case Study | Actual Trade

In stock news, AAPL and GS launched a joint “high yield savings account” product for holders of the AAPL credit card.  Bloomberg reported that KR is in talks to buy smaller rival ACI.  ACI spiked 11.5% on the news and KR also closed up 1.15%.  Elsewhere, NFLX announced its long-planned “with Ads” tier service for $6.99/mo. starting Nov. 3.  Later, STLA (Dodge/Jeep parent) announced it is cutting one of its three shifts at its Warren MI plant due to a persistent shortage of chips.  Meanwhile, the Chairman of C told a conference that higher capital requirements for big banks (as proposed for the banks entering into riskier cryptocurrency business) might curb lending and make the “potential coming recession” worse.  Finally, a Brazilian court has fined AAPL $19 million and ordered that the iPhones the company sells in that country must come with chargers.

In trading news, on Thursday afternoon, Reuters reported that 24×7 stock trading is likely coming to the US within 5 years.  The report cited sources at several brokers, electronic exchanges, as well as the CBOE exchange, all speaking at the Security Traders Assn. Annual Conference.  There was no specific mention of Options, but one would assume that if the underlying assets were trading 24×7, the options on them would as well.  So, traders may need to study the trading processes and approaches being used in the Forex and Cryptocurrency markets today for a heads-up on how we may be trading stocks in the not-too-distant future.

In Energy news, despite the overall large build in US oil inventories last week, there was a disturbing drawdown in Diesel and Heating Oil stock.  The EIA reported that Distillates stocks, fell 4.9 million barrels for the week to the lowest level since May.  With Winter fast approaching this should be upsetting news for consumers that appear will get the shaft as low inventories allow dealers to charge higher prices.  This news was partially responsible for oil’s 2% rise on Thursday, despite a 10 million barrel increase in oil inventories and a 2 million barrel increase in gasoline stockpiles.

Overnight, Asian markets leaned heavily to the green side. Only Thailand (-0.12%) and Singapore (-0.03%) were in the red.  Meanwhile, Japan (+3.25%), Shenzhen (+2.81%), and Taiwan (+2.48%) led the gainers.  In Europe, we are seeing a similar push to the upside at midday.  Only Russia (-0.79%) is showing red, while the FTSE (+1.25%), DAX (+1.21%), and CAC (+1.77%) lead the region higher in early afternoon trade.  As of 7:30 am, US Futures are pointing toward a modestly green open after Thursday’s volatile, large gain.  The DIA implies a +0.47% open, the SPY is implying a +0.32% open, and the QQQ implies a +0.08% open at this hour.  10-year bonds are showing their own volatility, plunging back down to 3.887% while Oil (WTI) is off just over 1% to $88.13/barrel in early trading.

The major economic news events scheduled for Friday include September Retail Sales and September Import/Export Price Indexes (both at 8:30 am), August Business Inventories, Mich. Consumer Sentiment, and August Retail Inventories (all at 10 am). The major earnings reports scheduled for the day include C, FRC, JPM, MS, PNC, USB, UNH, and WFC before the open.  There are no major reports scheduled for after the close.

So far this morning, UNH, JPM, WFC, C, USB, PNC, and FRC all posted beats on both the top and bottom lines.  JPM beat on revenue by almost $9 billion while the other large banks had significant revenue beats as well.  However, MS reported a miss on both revenue and earnings, which they attributed to a collapse of its investment banking business.  In addition, note that USB and FRC both lowered forward guidance after posting their beats.  Finally, KR (second only to WMT among US grocers) announced it has reached the previously mentioned deal to buy ACI (the fourth largest US grocer) for $34.10/share or $24.6 billion.

After yesterday’s extreme volatility and bullish reaction to CPI, as well as a dose of great earnings this morning, the overall mood is likely to be bullish, but leery early in the day. It is less likely the data we get today will reverse markets from any move, but it could dampen or amplify what Mr. Market is doing at that time. With that said, volatility remains a very big concern unless you have the stomach to ride out big swings.

With this backdrop, the premarket action seems to show some modest optimism. Extension isn’t a factor today, either in terms of the T-line or T2122. However, that T-line (8ema) will be a level to watch as we see whether it can hold as support for the large caps or resistance for the QQQ. Today we know three things for sure. First, the strong bear trend is still in place. Second, volatility and huge intraday reversals were off the charts yesterday. And third, the weekend, when we can’t adjust while the market is closed, lies just ahead. So, consider whether you need to take some money off the table or add hedges today. (Remember, the first rule of making big money is to not lose big money.)

So, don’t be stubborn. If you have a loss, just admit you were wrong and take it before it grows. And when the price does move in your direction, always move your stops in your favor (remember the “Legend of the man in the green bathrobe“…it is NOT HOUSE MONEY, it’s all OUR MONEY!). Also, keep in mind that trading is a job. It’s not a hobby. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Demonstrate patience and wait for confirmation. Lastly, remember that you get rich slowly and steadily in Trading…not by striking it rich on one or two trades. So, give up that lottery ticket mentality.

See you in the trading room.

Ed

Swing Trade Ideas for your consideration and watchlist: No trade ideas today. You can find Rick’s review of tickers on his YouTube Channel here. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service